KARACHI: Inspired by the frenetic growth enjoyed by the foreign franchises in Pakistan, more and more local businesses are now following suit and the domestic franchising industry now comprises around 10 per cent of the multibillion-rupee market.

During a seminar on Friday, Francorp-Pakistan CEO Anila Haq said most independent businesses fail to get off to a good start because they are totally on their own and lack enough finances to materialise all the ideas required to make a company successful.

The concept of franchising, on the other hand, has become increasingly appealing to investors and businesses as it helps them to mitigate risks and to break even early by letting them benefit from the goodwill and experience of the franchiser.

Typically, franchising is an arrangement where the franchiser lends the franchisee its name as well as certain systems and processes to produce and market goods or services, in exchange for a franchise fee and ongoing royalties on sales.

According to Ms Haq, food, retail and services remained the top three franchising industries in Pakistan. However, other segments are also forging ahead, including footwear, clothing and pharmacies.

Top local franchisers include 14th Street Pizza, OPTP and Chacha Jee, while leading foreign franchisers are Pizza Hut, KFC, McDonald’s, TGI Fridays and Subway, she said.

Some popular brands in areas other than the food sector include Marriott, Ramada Renaissance (in the hotel sector); Brinks, Wackenhut (security); Avis (car rental); and DHL, TNT, United Parcel, Federal Express (courier services).

“Franchising is the best thing for any business; business expands, the brand gets greater visibility and you don’t spend any money doing it because it is all paid for by the franchisee,” she said.

However, apart from its many benefits, concerns remain that franchising in our part of the world is largely corporate in nature, and that it has not trickled down to individuals, something which is the essence of the concept.

Published in Dawn March 1st , 2015

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